Post-Brexit rule changes could ‘lock-out’ landlords

buy-to-let lending tumbles
Buy-to-let lending has almost halved since the introduction of Stamp Duty surcharge

Crowdfunding platform Property Partner has claimed that the introduction of stricter borrowing requirements may soon ‘choke-off’ one of the most popular routes to reliable income. Currently, most lenders stress-test their mortgages so that rental income covers 125% of mortgage payments. This is known as the Interest Coverage Ratio (ICR). However, ahead of the Bank of England’s Financial Stability Report tomorrow (5th July), some providers are already resetting their ICRs to 145%. This could mean that a buy-to-let property with a mortgage in two-thirds of major towns and cities in the UK would require a massive 40% deposit.


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